UnitedHealth to Insure the Right to Insurance

By Reed Abelson
The New York Times
December 2, 2008
For these economically uncertain times, the UnitedHealth Group has a “first of its kind” product: the right to buy an individual health policy at some point in the future even if you become sick.
Called UnitedHealth Continuity, the product is not actual medical insurance, but is aimed at people who may have insurance now but are worried they may lose it — and may not be able to obtain replacement insurance on their own. They may expect to retire early, for example, before they qualify for Medicare. Or they are worried about the possibility of losing their job and their health coverage.
People who are already sick will generally not be eligible for the new product. Those who do pass a medical review, will pay 20 percent each month of the current premium on an individual policy to reserve the right to be insured under the plan at some point in the future.
http://www.nytimes.com/2008/12/03/business/03insure.html?ref=business

One of the many reasons that there is a push for comprehensive reform is that, in most states, individuals who have medical problems are denied the opportunity to purchase insurance on their own. This is one of the more serious flaws in insurance markets since this defeats the primary purpose of insurance – providing individuals with health care needs affordable access to health care.
Those crafting reform would address this problem by including guaranteed issue in their reform proposals. Insurers would be required to offer coverage to those with health care needs, but this would work only if it were coupled with an individual mandate for everyone to purchase coverage, otherwise premiums would skyrocket because of a concentration of high-cost individuals in the insurance risk pools.
There are still those who would prefer to see private sector solutions in the insurance marketplace. In this new product, UnitedHealth Continuity, the private insurance industry is demonstrating the thinking behind market solutions to our health insurance problems. A public sector approach would automatically include everyone forever, making health care a right. In a plan that only the innovative private marketplace sector could devise, the UnitedHealth Group, without providing any insurance benefit whatsoever, has created a way of selling us the the right to health care at some time in the future, but a right that you can purchase only if you are healthy and don’t need care.
Besides the most obvious flaw of selling a right that everyone should have, there is another policy flaw in this proposal. Those who purchase this right and remain healthy would have a full range of insurance options and might well choose other options that may be more appropriate. Those who develop medical problems in the interim would have no choice but to enroll in this plan, only to find that premiums would be unaffordable because of the concentration of other high-cost individuals in the program.
Even with guaranteed issue, an individual mandate, and a regulated marketplace, the private insurance industry will continue to innovate to enhance the business success of their industry. With chants of “health care is a right” in the background, the insurance industry has provided us with yet another innovation in which they can sell to us our right without providing any service or product, merely the option to purchase coverage in the future.
Would someone explain once again why momentum is building in Washington, D.C. to keep this industry in charge of our health care financing? With a single payer national health program, we would play by our rules, not theirs.

By Reed Abelson
The New York Times
December 2, 2008

For these economically uncertain times, the UnitedHealth Group has a “first of its kind” product: the right to buy an individual health policy at some point in the future even if you become sick.

Called UnitedHealth Continuity, the product is not actual medical insurance, but is aimed at people who may have insurance now but are worried they may lose it — and may not be able to obtain replacement insurance on their own. They may expect to retire early, for example, before they qualify for Medicare. Or they are worried about the possibility of losing their job and their health coverage.

People who are already sick will generally not be eligible for the new product. Those who do pass a medical review, will pay 20 percent each month of the current premium on an individual policy to reserve the right to be insured under the plan at some point in the future.

http://www.nytimes.com/2008/12/03/business/03insure.html?ref=business

Comment:

By Don McCanne, MD

One of the many reasons that there is a push for comprehensive reform is that, in most states, individuals who have medical problems are denied the opportunity to purchase insurance on their own. This is one of the more serious flaws in insurance markets since this defeats the primary purpose of insurance – providing individuals with health care needs affordable access to health care.

Those crafting reform would address this problem by including guaranteed issue in their reform proposals. Insurers would be required to offer coverage to those with health care needs, but this would work only if it were coupled with an individual mandate for everyone to purchase coverage, otherwise premiums would skyrocket because of a concentration of high-cost individuals in the insurance risk pools.

There are still those who would prefer to see private sector solutions in the insurance marketplace. In this new product, UnitedHealth Continuity, the private insurance industry is demonstrating the thinking behind market solutions to our health insurance problems. A public sector approach would automatically include everyone forever, making health care a right. In a plan that only the innovative private marketplace sector could devise, the UnitedHealth Group, without providing any insurance benefit whatsoever, has created a way of selling us the the right to health care at some time in the future, but a right that you can purchase only if you are healthy and don’t need care.

Besides the most obvious flaw of selling a right that everyone should have, there is another policy flaw in this proposal. Those who purchase this right and remain healthy would have a full range of insurance options and might well choose other options that may be more appropriate. Those who develop medical problems in the interim would have no choice but to enroll in this plan, only to find that premiums would be unaffordable because of the concentration of other high-cost individuals in the program.

Even with guaranteed issue, an individual mandate, and a regulated marketplace, the private insurance industry will continue to innovate to enhance the business success of their industry. With chants of “health care is a right” in the background, the insurance industry has provided us with yet another innovation in which they can sell to us our right without providing any service or product, merely the option to purchase coverage in the future.

Would someone explain once again why momentum is building in Washington, D.C. to keep this industry in charge of our health care financing? With a single payer national health program, we would play by our rules, not theirs.